{"id":94682,"date":"2025-11-21T17:53:50","date_gmt":"2025-11-21T16:53:50","guid":{"rendered":"https:\/\/dexxter.be\/how-to-record-your-mortgage-loan-in-your-accounts\/"},"modified":"2026-06-18T11:52:21","modified_gmt":"2026-06-18T09:52:21","slug":"how-to-record-your-mortgage-in-your-accounts","status":"publish","type":"post","link":"https:\/\/dexxter.be\/en\/blog\/how-to-record-your-mortgage-in-your-accounts\/","title":{"rendered":"How to record your mortgage in your accounts"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">Buying a home as a self-employed person is exciting, but it also raises a practical question: <strong>how to record a mortgage in your accounts?<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The good news: it\u2019s less complicated than it sounds. Below, you\u2019ll find a step-by-step guide on how it works, what you can and cannot deduct, and the mistakes that self-employed people often make.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Should you always include a mortgage loan in your accounts?<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">That depends on <strong>what the property is used for<\/strong>.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Private residence<\/strong><br>Do you use the property solely for private purposes? Then the loan <strong>does not<\/strong> appear in your sole proprietorship\u2019s accounting records. The mortgage payment is a personal expense.<br><\/li>\n\n\n\n<li><strong>Home with a business section<\/strong><br>Do you use part of the home as an office, workshop, or consulting room? Then you may claim <strong>part of the costs<\/strong> as business expenses. In this case, the mortgage loan is included in your accounting.<br><\/li>\n\n\n\n<li><strong>Entirely business-use property<\/strong><br>Are you purchasing a property that you use exclusively for professional purposes? Then the professional use percentage is 100%.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Should you buy a home personally or through your business?<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">If you run a sole proprietorship, you can technically <strong>purchase<\/strong> a home through your business, <a href=\"https:\/\/dexxter.be\/en\/blog\/three-reasons-why-you-are-better-off-not-putting-your-house-or-home-office-in-as-a-cost\/\">but in reality, this is almost never a good idea<\/a>. This is because the cost is equal to the annual depreciation.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Depreciation essentially means a \u2018decrease in value&#8217;. In reality, homes only increase in value. You receive a benefit now, but will end up paying taxes later because your property has appreciated in value.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For self-employed individuals, the best choice is usually:<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u27a1\ufe0f <strong>Purchase the home privately.<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u27a1\ufe0f <strong>Only claim the business-related interest on the loan.<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>What can you claim as a professional expense when taking out a mortgage?<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">It\u2019s important to know that you <strong>cannot claim the loan itself<\/strong> as a deduction. You also cannot claim \u201cthe monthly payment\u201d as an expense.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">So what can you claim?<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>1. Loan interest<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Only the <strong>interest paid<\/strong> is tax-deductible. You should claim this interest as a business expense; it may be fully or partially deductible, depending on the professional use. This does not include the principal payments themselves.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>2. Deductible loan-related expenses<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">You can also include loan-related expenses in your accounting records; these can be deducted at the same rate as the interest.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Some examples:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>administrative fees<\/li>\n\n\n\n<li>valuation fees<\/li>\n\n\n\n<li>notary fees for the mortgage<\/li>\n\n\n\n<li>deed fees related to the loan<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>3. Optional: Depreciation of the business section<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">You may also be able to depreciate the home itself. You spread the purchase price over several years (usually 20 to 33 years), and that depreciation amount is deductible in proportion to the professional use.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This is only possible if you purchased the home (in part) professionally, <a href=\"https:\/\/dexxter.be\/en\/blog\/three-reasons-why-you-are-better-off-not-putting-your-house-or-home-office-in-as-a-cost\/\">but this is generally not recommended<\/a>!<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>How to determine the professional use percentage<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">You may only claim the amount that corresponds to <strong>the actual professional use<\/strong>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Many self-employed individuals use a simple method:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>office area \/ total area of the home<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">Example: a 12 m\u00b2 office in a 120 m\u00b2 home \u2192 10%.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">You use this percentage for:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>interest deduction<\/li>\n\n\n\n<li>depreciation<\/li>\n\n\n\n<li>costs associated with the loan<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u26a0\ufe0f Please note: this percentage must remain realistic. Most professionals cannot claim their bedroom.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>How to record the loan in your accounts<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Enter an expense in your accounts. As supporting documentation, you can upload the depreciation table you received with your home. This shows how much interest you pay each year. In the early years of your loan, this amount is higher than in later years.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Multiply that amount by the professional percentage and record it as a deductible expense. The cost category where you can record this is \u201cvarious financial costs and bank charges&#8221;.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 2: Record the additional costs<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Costs such as administrative fees or valuation fees should also be recorded in proportion to the professional use. You can, for example, record these under <strong>\u201dProperty maintenance, partially related to your profession\u201d<\/strong>, or create a new subcategory under <strong>\u201dCosts of housing\u201d<\/strong> called <strong>\u201dMiscellaneous home expenses\u201d<\/strong>.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Step 3: DO NOT record the payment itself<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">The capital repayment (the \u201cprincipal\u201d portion of your monthly payment) is <strong>not an expense<\/strong> and does not appear on your income statement. It is simply a personal expense.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Common mistakes made by self-employed<\/strong> individuals<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>thinking that the <strong>full repayment<\/strong> is deductible<\/li>\n\n\n\n<li>not using a realistic professional use percentage<\/li>\n\n\n\n<li>recording the cost of the deed of purchase separately when it should be depreciated<\/li>\n\n\n\n<li>assuming that the home is \u201cused for business purposes,\u201d which is not possible for sole proprietorships<\/li>\n\n\n\n<li>forgetting that a personal loan can never be claimed as 100% professional<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>What happens if you sell the property later?<\/strong><\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The professional section is considered \u201cbusiness-related&#8221;.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">That part may be subject to <strong>capital gains tax<\/strong> when you sell.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The higher your professional percentage, the greater that impact.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This is why many self-employed individuals deliberately opt for a <strong>limited but defensible professional percentage<\/strong>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>FAQ on mortgage loans in accounting<\/strong><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Should you include a mortgage loan in your accounts as a self-employed person?<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Only if you use part of the home for business purposes. The private section remains private.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>What can you deduct from a mortgage loan?<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">The interest, depreciation of the professional part, and costs such as administrative and valuation fees.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Is the entire monthly payment deductible?<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">No. Only the <strong>interest<\/strong> is deductible. The capital repayment is not.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>How to calculate the professional percentage?<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">By dividing the business area by the total floor area of the home.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Should you buy a home through your sole proprietorship?<\/strong><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">No. It\u2019s better to keep the home private; you only claim the business section as an expense.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Buying a home as a self-employed person is exciting, but it also raises a practical question: how to record a mortgage in your accounts? The good news: it\u2019s less complicated than it sounds. Below, you\u2019ll find a step-by-step guide on how it works, what you can and cannot deduct, and the mistakes that self-employed people [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":94683,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[35],"tags":[],"class_list":["post-94682","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-professional-costs"],"_links":{"self":[{"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/posts\/94682","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/comments?post=94682"}],"version-history":[{"count":3,"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/posts\/94682\/revisions"}],"predecessor-version":[{"id":96051,"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/posts\/94682\/revisions\/96051"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/media\/94683"}],"wp:attachment":[{"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/media?parent=94682"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/categories?post=94682"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dexxter.be\/en\/wp-json\/wp\/v2\/tags?post=94682"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}